Definition of an Agent of a Broker-Dealer

What this video covers

• Why an agent is always a natural person, and why corporations, partnerships, and limited liability companies (LLCs) can never be agents regardless of what transactions they conduct
• The three-part agent test: natural person, representation of a broker-dealer (BD) or issuer, and effecting or attempting to effect securities transactions
• Why an investment adviser representative (IAR) giving pure advice is not an agent, and the exact moment an IAR crosses into agent status
• When partners, officers, and directors of a BD become agents, and why their registration happens automatically through the firm while rank-and-file representatives must register individually
• The four memorizable exempt securities categories that exclude issuer representatives from agent status, and why credit union shares and insurance securities are deliberately left off that list
• The no-commission issuer employee exclusion and how any direct or indirect remuneration (including a tied bonus) instantly destroys it
• Why federal covered securities do not automatically exclude issuer reps, and the exact two categories (sales to qualified purchasers and Regulation A Tier 2 offerings) that do
• The BD de minimis established-customer exclusion and the two numbers that control it: 30 days for the account and 14 days for the specific rep assignment
• Why attempting to effect a trade (even an immediate failed cold call) fully triggers the agent definition